Tamarugal basin exploration under way in northern Chile

Michael Roos
Cardinal Resources Inc.
Santiago

Recent geological/geophysical evaluations of the contract area by both Cardinal and Empresa Nacional del Petroleo (ENAP), the state energy company, have upgraded the hydrocarbon potential of this northern basin, making it an attractive exploration play. The Chilean field operations have experienced steady progress for almost a year. Presently Cardinal maintains a 75% interest and ENAP holds the remaining 25%.

James J. Boyle, Cardinal president and chairman, envisions the program will be the first of many Chilean projects involving a partnership with ENAP. Boyle believes Chile is one of the least risk countries in which a U.S. independent can participate; Chile's economic, political, and investment friendly standards are among the highest in the world.

The contract area

The area is called the "Depresion Intermedia de Arica." It covers about 5,000 sq km (1.2 million acres) in the Tamarugal basin of northern Chile (Fig. 1 [31858 bytes]). This basin is a morphological-structural depression about 600 km long and 50-60 km wide. It is bounded on the west by the Cordillera de la Costa (Coastal Range) and on the east by the Altiplano (Fig. 2 [30297 bytes]).

A Jurassic marine megasequence of more than 2,000 m containing good quality source rocks, limestones, evaporites, and transgressive sandstones is present in the basin. Depth of burial modeling indicates that the Jurassic is well within the oil window.

Hydrocarbons

In northern Chile two oil seeps have been encountered. One is located in the Tamarugal basin south of the contract area; the other is in the Altiplano east of the contract area. The oil encountered in the Tamarugal basin was recovered from a cavity in a Jurassic ammonite fossil. Analyses show that the Jurassic shales from which the ammonite was recovered have excellent source rock characteristics. Under appropriate conditions of burial and thermal stress, these shales could yield large quantities of oil. Also, analysis of the oil from the ammonite indicated migration of oil from mature rocks in this aea.

The second oil seep is located on an anticline east of the contract area. Bitumen has been found in fractures there. Although geochemical analyses are limited, it is believed that the oil was generated from Paleocene lacustrine shales with very high TOC. As source rock here is generally immature, local heating by a Tertiary intrusive appears to have generated sufficient thermal stress to propagate hydrocarbons.

Structural history

The Jurassic basin in northern Chile began its development during Hettangian and/or Sinemurian (Lias). The development is related to the start of a convergent margin, resulting in the development of a volcanic arc and back-arc.

The volcanic arc was located in a zone that today is the Cordillera de la Costa. This volcanism is reflected in volcanic rocks interbedded with shallow marine sediments. During the Lias, this volcanism had its maximum intensity and resulted in the development of an island arc. During Dogger, the volcanic activity diminished and at the same time strong subsidence in the back-arc basin resulted in the deposition of a thick sequence of marine sediments, relatively free of volcanic contamination.

The sedimentary environment continued until the end of the Neocomian (Early Cretaceous). During the Lower Cretaceous, the subduction zone migrated toward the east, resulting in the intrusion of granodioritic batholiths in the Cordillera de la Costa. During Miocene-Pliocene, the Altiplano was uplifted to its present elevation. The western boundary of the Altiplano, which acted as a hinge zone, is outlined by a tectonic belt with intrusions and volcanism and late Tertiary downfaulting toward the Pampa de Tamarugal. During this time volcanic activity resumed, and because of the eastward migration of the subduction zone, the main centers of volcanism are now located in the Altiplano.

Starting with the early Jurassic, the area has been affected by five deformation phases: the above-mentioned extensional phase during Hettangian and/or Sinemurian, a strong compressional phase at the end of Neocomian, and two minor compressional phases during early Tertiary. The last compressional phase, associated with right lateral wrenching, took place during the Miocene and resulted in the uplift of the Altiplano (Fig. 3 [31858 bytes]).

Jurassic stratigraphy

Regarding pre-Jurassic sequences, no source rocks or seals appear to be present. No reservoirs with acceptable porosities appear present; however, secondary porosity and/or fracture porosity could be present.

Outcrops of Jurassic rocks are found along the foothills of the Andean Cordillera and along the Cordillera de la Costa. This megasequence represents the evolution of the marine back-arc basin that extended from the offshore area into what today is the Chilean-Bolivian Altiplano (Fig. 4 [54531 bytes]).

Within the Jurassic megasequence, two facies types can be distinguished, the marine facies toward the east and the volcanic facies in the west. Many of the outcrops have been studied by ENAP, especially the Jurassic marine facies near the village of Livilcar, east of the contract area. The Livilcar formation consists of a megasequence of marine sandstones, shales (with TOCs up to 2.7%), carbonate rocks and evaporites with a thickness totaling 1,700 m in Livilcar, and possibly 2,000 m in the Quebrada de Lluta, farther to the north.

West of the Contract Area, just south of the city of Arica, an outcrop of the Jurassic volcanic facies is present. The Jurassic in this location has a thickness of 4,000 m and the megasequence that can be subdivided into four units. Unit 1 represents the initial phase in the building of the volcanic arc. Deepening of the basin results in the initial deposition of sandstones, interbedded limestones, and pillow lavas. Unit 2 represents active volcanic activity in the volcanic arc, resulting in the deposition of approximately 1,000 m of andesites, dark gray shales, and sandstones. Unit 3 indicates the diminishing volcanic activity and a more restricted depositional environment. This unit contains organic rich shales, limestones, and minor amounts of andesites. Unit 4 shows a shallow marine-continental facies with conglomerates, sandstones, and minor amounts of interbedded limestones.

Interpretations

Interpretation of 1984 aeromagnetic and Landsat data has been useful in the analysis of the Contract Area. They have indicated that in the Cordillera de la Costa, northeast-southwest trending faults are abundant and dominant. These faults appear to offset northwest-southeast trending faults within the area. In the Tamarugal basin, faulting is not that obvious because of thick, late Tertiary and Recent cover.

However, as in the Cordillera de la Costa, northeast-southwest trending faults are dominant and appear to be younger than the northwest-southeast trending faults. The Altiplano is dominated by northwest-southeast trending fault systems that reflect the Miocene uplift of the Altiplano.

During the early 1960s ENAP drilled six stratigraphic wells. Recent additional geological investigations by ENAP and other companies resulted in the upgrading of the hydrocarbon potential of the northern Tamarugal basin. These investigations have indicated that good quality source rock and surface outcrops are present within the Jurassic megasequence and that these are in the oil window. Also there are reservoirs present in the basin, both in the form of sandstones and conglomerates or fractured limestones. The widespread evaporite deposits within the Jurassic should provide excellent hydrocarbon seals in the area; although, the excellent quality Paleocene source rock is believed to be immature. The local Tertiary igneous intrusions have possibly brought the source rock within the gas or oil window.

Limited seismic data gathered in 1986 are of poor quality which may be due to line location with respect to igneous and volcanic activity. By changing the source technique and/or improving the recording and processing parameters, data quality could improve. This data quality improvement is envisioned within the first exploration period.

The recent interpretation of reprocessed aeromagnetic data resulted in a recommendation for more detailed exploration and the acquisition of gravity data to allow the definition of the sedimentary basin. This gravity work program has recently commenced and will be integrated with earlier geological studies and geophysical work, providing a clear direction for the balance of the work program.

The exploration program will span 5 to 10 years and include drilling one well a year, following a 2 year period of seismic data gathering, as the following illustrates:

• First exploration period (2 years), geological work including surface mapping, Landsat, aeromagnetics and gravity.

• Second exploration period (1 year), geological, geophysical, and geochemical work.

• Third exploration period (1 year), drill one exploratory well.

• Fourth exploration period (1 year), drill one exploratory well.

• Fifth-ninth exploration period (1 year per period), if elect to proceed, one exploratory well will be drilled during each of these periods.

Cardinal and ENAP are completing the first exploratory period and will admit industry partners before the start of the second exploratory period.

The Author

B. Michael Roos is general manager of Cardinal Resources Inc.-Chile in Santiago. He is responsible for coordinating all activities in Chile including field supervision, geological and geophysical surveys, and coordination with ENAP and local legal and accounting representatives. He was vice-president and general manager of Argentina and Chile for Hunt Oil Co. during 1986-93.

He has previous industry experience in the Middle East, Europe including the North Sea, Africa, and the U.S., including field studies, basin evaluations, seismic interpretation, contract negotiations, and supervision of exploitation and exploration operations. He has BS and MS degrees in geology from Leiden State University, Netherlands.

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